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129326

The Management Report Usefulness in Lending Decision: Investigating Egyptian Credit Managers Perceptions

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Last updated: 22 Jan 2023

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Abstract

This study investigates Egyptian credit managers perceptions regarding the management report disclosures provided by firms to banks and how this represent a useful source of information for credit managers in rationalizing the lending decision. We surveyed credit managers in all banks listed by the Central bank of Egypt to determine whether disclosures are meeting the needs of this group of financial reports' users. The final sample consists of 160 credit managers and their credit officers who work in Egyptian private and governmental banks as well as foreign banks operating in Egypt. Through hypotheses testing the main findings reveal that credit managers perceive both mandatory and voluntary disclosures as useful. Moreover, there was significant difference in some of their perceptions, these differences were explained through psychological engagement (i.e. gender, experience, educational level, and background) throughout the analysis. Some voluntary disclosures are more useful than mandatory disclosures, which clarify the existence of a gap between regulators and users' perceptions. Moreover, the findings show that respondents consider information related to risk management, key performance indicators, and forward-looking more important than information on corporate governance and corporate social responsibility (CSR). The current study extends and enriches the ongoing academic and practical debate on the usefulness of narrative disclosures. Our findings suggest that regulators should seek more improvement to the current requirements as voluntary disclosures which were found to be more important. Our investigation touched a blind spot in the literature and provided evidence for the usefulness of MR disclosure in lending decision, as previous studies investigated the usefulness of management reports in investment decision.

DOI

10.21608/cfdj.2021.129326

Keywords

disclosure, usefulness, Emerging market, Credit managers, lending decision, Management report

Authors

First Name

Abdelmoneim

Last Name

Metwally

MiddleName

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Affiliation

کلية التجارة - جامعة أسيوط

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Orcid

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First Name

Abdelnasser

Last Name

Mohamed

MiddleName

-

Affiliation

کلية التجارة - جامعة أسيوط

Email

nassertaha@aun.edu.eg

City

-

Orcid

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First Name

salah

Last Name

Ali

MiddleName

-

Affiliation

assistant professor in accounting, University of Bahrain, and Lecturer in accounting, faculty of commerce, Assiut University

Email

samali@uob.edu.bh

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Orcid

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Volume

2

Article Issue

العدد الأول - الجزء الأول

Related Issue

19258

Issue Date

2021-01-01

Receive Date

2020-06-10

Publish Date

2021-01-01

Page Start

1

Page End

53

Print ISSN

2682-3403

Online ISSN

2682-4531

Link

https://cfdj.journals.ekb.eg/article_129326.html

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https://cfdj.journals.ekb.eg/service?article_code=129326

Order

5

Type

المقالة الأصلية

Type Code

1,242

Publication Type

Journal

Publication Title

المجلة العلمية للدراسات والبحوث المالية والتجارية

Publication Link

https://cfdj.journals.ekb.eg/

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Article

Created At

22 Jan 2023